This content is not available in your region

UK Budget

UK Budget
Text size Aa Aa

With an election on the cards this May, Alistair Darling, the British Chancellor, has tried to draw up a budget designed to simultaneously cut the government’s deficit and stimulate economic growth. The British Finance Minister aims to cut the deficit from 11.8% this year to 4% in 2014. He bases this on growth of 1 to 1.5% this year rising to 3 to 3.5% per year from 2011.

Reducing the British deficit is key for investors who fear that credit rating agencies might down-grade the British debt. The British debt should rise from 54% of GDP this year to 75% in 2014. But with unemployment running at 7.8% creating jobs remains a priority.

This is one of the results of 18 months of recession during which the UK economy contracted by 6%. One of the measures aimed at supporting a still-fragile recovery is the suspension of stamp duty for first time buyers of property worth less than the equivalent of 279,000 euros.

The budget also sets out plans for a green bank worth 2.3 billion euros to support low-carbon emmiting industries, and 2.8 billion euros are set aside for small businesses to encourage innovation and improve financial performance.

A further measure spotlights the Royal Bank of Scotland et Lloyds, which will get 105 billion euros for lending to small businesses. There will also be help for up to a million people on low incomes who have been refused banking facilities by the high street banks.